These days people bandy the term "space-saving" about in hopes it will make their product more attractive to us city dwellers, particularly since there are now more of us than there are rural dwellers. But much of the supposedly space-saving furniture I've seen merely transforms from one thing to another, often in a very clumsy way; to me those objects do two things poorly rather than one thing well, and their novelty outweighs their functionality.
One company I've found that truly "gets" space-saving is New-York-based Resource Furniture, which distributes Italian brand Clei and other European furniture manufacturers. (You probably recognize the name Clei from their much-blogged orange couch that transforms into bunk beds.) The products Resource Furniture offers have a high level of design and engineering, with no compromises; there are no lumpy futon mattresses or "Grab lever A while holding switch B, then pull lever C" complications. The engineering is completely invisible, as it ought to be, the transformations do not require science backgrounds to execute, and each piece serves each of its dual functions as well as if it were a standalone. On top of that, they look good.
As seen above, Ron Barth, President of Resource Furniture (along with Trade Account Manager Challie Stillman) took some time out to give Core77 a personal showroom demo. I'd be hard-pressed to pick a favorite out of all the stuff they showed us, but that hydraulic desk at 3:07 and the mind-blowing cabinet at 5:38 would probably make top of the list!